Tuesday, December 31, 2013
Monday, December 30, 2013
Whats the best trade idea for 2014 ?
The answer according to well known investor Dennis Gartman is....
"Continuing to be short of yen against the English-speaking currencies—selling yen against sterling, selling yen against the U.S. dollar, selling yen against the Canadian dollar—I think that's going to be the great trade of 2014"
Thursday, December 26, 2013
"Within seconds of the announcement... I had no choice - I had to come in and buy more stocks and reduce any hedges I had and make certain that the long positions I had in the dollar, I've been very bearish on the yen -- were increased."
There was no question an abundant part of yesterday's panic buying [was due to] people saying 'Oh my word I'm short, I'm wrong and I have to get out'...Some of the smartest guys I know have been short the market all the way up and I've seen more of that than people being long the market.
Tuesday, December 24, 2013
"I thought it would be deferred and put into the hands of the next Fed chairman [Janet Yellen] at the March meeting."
Monday, December 23, 2013
But I never actually thought they'd move to reduce the speed with which we're driving down the highway."
Wednesday, December 18, 2013
Tuesday, December 17, 2013
Investors must continue to obey the charts. Dennis Gartman believes the rally in stocks will continue, and he draws upon his years of trading experience to make that determination.
"I will simply use an old man's view of the market, and say it's been moving from the lower left to the upper right," the editor and publisher of The Gartman Letter said on Tuesday's "Futures Now." "Weakness has been properly purchased and strength has been improperly sold. It will continue to go up until the trend lines are broken—and right now they are far from being broken."
"Write this down: 'It will continue to go up until it stops. I've only been at this 40 years, but I'm constantly amused by attempts to discern where the top shall be, or conversely, where the bottom shall be. Stocks stop going down when they stop. Stocks stop going up when they stop. That's the best you can do."
On Higher Treasury Yields
"I've been at this for a long time. I remember trading the 30-year [bond] with a 14.25 coupon. So does 2.85 on the 10-year, does 3 percent on the 10-year, does even 4 percent on the 10-year frighten me? Not really," he said. "So that's just a perspective of history."
On the S&P500 year 2013 target price
"I suspect that the propensity to take [stocks] to new highs is probably limited. ... I suspect that the propensity to try to sell it down from current levels is limited," Gartman said. "I wouldn't be surprised if they closed exactly where they are right now."
Monday, December 16, 2013
Dennis Gartman, is looking for the weak trend to continue. He tells clients in last week’s Gartman Letter he’s looking for a move to 112-115 per dollar, a level not seen since late 2007:
There will be many who argue … with some very real justification … that this trade is crowded. It is. We shall admit that fact, but we also have the Central Bank at our back; we have the trend at our back; we have profits at our back, and those on the other side have none of the above. We’ll take our chances with the trend. It has served us well thus far.
Sunday, December 15, 2013
Top five trades to close out the year.
5. Short U.S. Treasurys
"I want to be short the U.S. bond market," he said on CNBC's "Fast Money." While Gartman said that he had taken off his short position on Monday, he added, "You give me a point and a half rally on the long end, I'm selling the long end of the market."
4. Own metals
"I want to own copper. I want to own steel. I want to own railroads. I want to own ships," Gartman said. "The very basic plumbing of basic economic growth. Old story, it's a good story. It's a been a story that has worked for a long period of time. It's a simple story." The industrials play is a bet on growth, he said, pointing out that China held potential.
"This is a very clear, rational bet on global growth," he said. "No question about that." The underlying assets are attractive, Gartman added.
3. Long the Nikkei
"It's being long of the equities market predicated upon the fact that the Bank of Japan is expanding its reserves even more aggressively than has been the Fed," Gartman said. "It's going to continue. It has no choice. Mr. Abe has three arrows that's he's firing on the economy. The only one that's really working at this point is No. 1, which is to expand reserves."
Noting strength in Japanese equities, Gartman said that it would continue to strengthen. "You can actually be short other markets, but you want to be long the Nikkei," he said.
2. The gold trade
"You want to own gold in yen terms," Gartman said, echoing a trade he has long espoused. "It's been a terrible trade for the last year. It's down 7 percent, but if you've owned gold in dollar terms, you're down 35 percent." Gartman said that one way to own gold in yen terms was to buy, say, GLD, the gold exchange-traded fund and sell an equal amount of a Japanese yen ETF.
Being long the Nikkei, he added, was the same as selling the yen. "Do one or the other," Gartman said.
1. Playing a currency-cross
Gartman said that his top trade heading into year-end was to short the yen against the Canadian dollar and the British pound, a trade he had been talking about "for months." "Just today, it's started to take off again,"
Thursday, December 12, 2013
Dennis Gartman, editor and publisher of the Gartman letter, writes that it was Madiba, as Mandela was fondly called, who "kept South Africa together after the end of Apartheid," and that he now "fears" for South Africa.
"It was Nelson Mandela who forced the blacks in S. Africa to push ahead with the reconciliation councils rather than physically attacking whites living there. It was Madiba who chided radical blacks bent upon revolution rather than reconciliation, and it was Madiba who brought the whole of S. Africa into the modern world and showed the world that the leaders such as Mugabe from Zimbabwe, or Mobutu Sese Seko of the Congo needn’t be the hallmarks of a new African leadership.
"We do fear for S. Africa now that Madiba has passed away, for we fear that it was his presence that kept radicals such as Julius Malema at bay and away from the wheels of power there. One “look” from Madiba... one comment... one statement was sufficient to force Malema to be ousted from his position of authority within the ANC’s Youth League. President Zuma... a man in which we’ve no confidence whatsoever and a man given to the most lunatic decisions and actions... at least had to remain within the bounds of common sense knowing that Nelson Mandela could and would call his hand at a moment’s notice.
"Hence we fear for S. Africa once the period of mourning for the passing of this great man is passed; but for now we mourn the loss of this truly great man... a man for the ages, the likes of which we shall not likely see in our lifetime again."
Gartman goes on to compare President Obama and Madiba, saying the President is a man of the left moving farther in that direction. Mandela on the other hand, he writes, "was a man of the Left who moved to the centre and created a nation."
Wednesday, December 11, 2013
It's been a devastating year for fertilizer bulls and anyone who owns shares of Potash Corporation of Saskatchewan (POT-T).
In October, PotashCorp cut its 2013 profit outlook after the breakup of the Eastern European potash cartel sparked a drop in fertilizer prices. On Tuesday, the other shoe dropped when PotashCorp announced it was firing 18 percent of its workforce amid low prices and weak demand.
Dennis Gartman, editor and publisher of the widely followed Gartman Letter, tells BNN agriculture is "not a pretty business to be in." During a recent trip to Iowa, Gartman says he was stunned at the amount of grain and corn that's been produced.
"There's a huge crop out there and it's getting larger as they take it in," Gartman says. "And with the almost certain decrease in the mandate for ethanol usage in the United States, corn is in oversupply."
Gartman isn't calling a bottom and warns there could be more downside in agricultural commodities and fertilizer stocks. PotashCorp shares have rallied since hitting a 52-week low in early August and currently provide a dividend of more than 4 percent.
Several currency strategists have told BNN the recent slide in the Canadian dollar is an overreaction. But Gartman sees a major problem with the Canadian dollar, which is trading near a three-year low ahead of the Bank of Canada meeting tomorrow.
"The reserve banks of Australia and New Zealand are both talking down their dollars without equivocation. It's very hard for the Canadian dollar to rally," Gartman tells BNN, adding he's lost money buying the Canadian dollar against the Japanese yen.
Gartman says he is bullish on the U.S. dollar. "Relative to all other currencies that's probably the better place to be right now."
Tuesday, December 10, 2013
"We look for a very slightly bullish report," economist Dennis Gartman, who is based in Suffolk, Virginia, said in his daily Gartman Letter. "Demand for corn, soybeans and wheat shall be cited as remaining very strong even as supplies continue to grow."
Monday, December 9, 2013
Raising bond shorts: Benchmark U.S. 10-Year Treasury rates hovered near three-month highs on Wednesday after a stronger-than-expected ADP jobs report.
Dennis Gartman of The Gartman Letter had been recommending the short bond trade since October. "I'm looking to get shorter, I think you could take the 10-year sometime next year well above 4 percent."
Sunday, December 8, 2013
Dennis Gartman, editor and publisher of The Gartman Letter says, "at least the now deceased President Hugo Chavez Frias was both entertaining and brilliant. …The gentleman who has followed him is simply an idiot." From Gartman:
"We know this every day for several times each day he comes up with some new, idiotic left-wing policy that only a socialist could love and put forth. Yesterday, President Maduro issued a decree controlling the price of new and second-hand cars. New cars are currently all but impossible to find due to import restrictions he’s imposed and due to the fact that automobile manufacturers are unwilling to send cars to the country fearing expropriation by the government. Hence, Venezuelans now have to pay very high prices for used cars, with the price for used cars already there in Venezuela leaping above the "list price for new cars."
"…According to the new decree, the citizens of Venezuela will be “Expressly forbidden to speculate on the prices of second-hand vehicles as though they were new...” and those who break the new law will face jail sentences of six to 12 years.
"The President’s office said last evening that there will be more details today when the decree is official published in the nation’s newspapers; however what we found most fascinating and modest sadly comical was that this is the 625th such decree since he took office April 19th of this year. He’s making an aver age of 2.7 decrees/day. Such is the life of an idiot, socialist despot, making life for his people more and more difficult by the hour. Lunacy has no bounds."
Monday, December 2, 2013
Dennis Gartman, editor and publisher of the Gartman Letter, has 19 rules of trading from 2013.
SOMEONE’S ALWAYS GOT A BIGGER JUNK YARD DOG: No matter how much “work” we do on a trade, someone knows more and is more prepared than are we and has more capital!
PAY ATTENTION: The market sends signals more often than not missed and/or disregarded... so pay attention!
WHEN THE FACTS CHANGE, CHANGE! Lord Keynes... again... once said that “ When the facts change, I change; what do you do, Sir?” When the technicals or the fundamentals of a position change, change your position, or at least reduced your exposure and perhaps exit entirely.
NEVER, EVER, EVER ADD TO A LOSING POSITION: EVER!: Adding to a losing position eventually leads to ruin, remembering Enron, Long Term Capital Management, Nick Leeson and myriad others.
TRADE LIKE A MERCENARY SOLDIER: As traders/investors we are to fight on the winning side of the trade, not on the side of the trade we may believe to be economically correct. We are pragmatists first, foremost and always.
MENTAL CAPITAL TRUMPS REAL CAPITAL: Capital comes in two forms... mental and real... and defending losing positions diminishes one’s finite and measurable real capital and one’s infinite and immeasurable mental capital accordingly and alway.
WE ARE NOT IN THE BUSINESS OF BUYING LOW AND SELLING HIGH: We are in the business of buying high and selling higher, or of selling low and buying lower. Strength begets strength; weakness more weakness.
IN BULL MARKETS ONE MUST TRY ALWAYS TO BE LONG OR NEUTRAL: The corollary, obviously, is that in bear markets one must try always to be short or neutral. There are exceptions, but they are very, very rare.
"MARKETS CAN REMAIN ILLOGICAL FAR LONGER THAN YOU OR I CAN REMAIN SOLVENT:" So said Lord Keynes many years ago and he was... and is... right, for illogic does often reign, despite what the academics would have us believe.
BUY THAT WHICH SHOWS THE GREATEST STRENGTH; SELL THAT WHICH SHOWS THE GREATEST WEAKNESS: Metaphorically, the wettest paper sacks break most easily and the strongest winds carry ships the farthest,fastest.
THINK LIKE A FUNDAMENTALIST; TRADE LIKE A TECHNICIAN: Be bullish... or bearish... only when the technicals and the fundamentals, as you understand them, run in tandem.
TRADING RUNS IN CYCLES; SOME GOOD, MOST BAD: In the “Good Times” even one’s errors are profitable; in the inevitable “Bad Times” even the most well researched trade shall goes awry. This is the nature of trading; accept it and move on.
KEEP YOUR SYSTEMS SIMPLE: Complication breeds confusion; simplicity breeds elegance and profitability.
UNDERSTANDING MASS PSYCHOLOGY IS ALMOST ALWAYS MORE IMPORTANT THAN UNDERSTANDING ECONOMICS: Or more simply put, "When they’re cryin’ you should be buyin’ and when they’re yellin’ you should be sellin’!"
REMEMBER, THERE IS NEVER JUST ONE COCKROACH: The lesson of bad news is that more shall follow... usually hard upon and always with worsening impact.
BE PATIENT WITH WINNING TRADES; BE ENORMOUSLY IMPATIENT WITH LOSERS: Need we really say more?
DO MORE OF THAT WHICH IS WORKING AND LESS OF THAT WHICH IS NOT: This works well in life as well as trading. If there is a “secret” to trading... and to life... this is it.
CLEAN UP AFTER YOURSELF: Need we really say more? Errors only get worse.
ALL RULES ARE MEANT TO BE BROKEN: But they are to be broken only rarely and true genius comes with knowing when, where and why!
Sunday, December 1, 2013
Commodities trader Dennis Gartman believes the recent dip in the oil price, after a deal was reached between Iran and six world powers to curb its nuclear program, shows just how weak the yen currently is.
"This news alone should be supportive of the yen, for Japan is of course the nation most seriously exposed to the uncertainties of higher crude prices" he said in a research note on Monday. "The fundamentals of the Bank of Japan's aggressive expansion of its balance sheet trumps even this fundamental benefit...we are more bearish now than we were previously."
Gartman has a target price of 125 for the dollar-yen, a level it hasn't seen for the last eleven years.